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Copyright © 2012 by Wade & Company, SA. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
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Library of Congress Cataloging-in-Publication Data:
Wade, Woody.
Scenario planning : a field guide to the future / Woody Wade.
pages cm
Includes index.
ISBN 978-1-118-17015-1 (pbk)
ISBN 978-1-118-22692-6 (ebk)
ISBN 978-1-118-23741-0 (ebk)
ISBN 978-1-118-26444-7 (ebk)
1. Business forecasting. 2. Strategic planning. I. Title.
HD30.27.W336 2012
658.4’01--dc23
2011045563
To my beacons, Malcolm and Claire
Like most endeavors, this book became a reality only because many people helped out, providing interesting perspectives and making valuable suggestions, not to mention prodding, pushing, and pulling. For being such enthusiastic sources of ideas and inspiration, I’d like to thank them here.
Nathalie Wagner designed the book beautifully, in the process dealing with a lot of silly questions and suggestions from a nondesigner like myself—and always with a smile. Her patience was angelic. As a collaborator on many previous writing projects, my brother Stuart Wade has been editing me in one way or another for years, and he looked over much of the text in faraway Austin, making dozens of useful suggestions for a nip here and a tuck there. Even farther away, in Mexico City, Christian and Kristine Arroyo helped me launch the web site 11changes.com, which got the whole ball rolling. I spent many a Sunday evening Skyping with them, and I’m grateful for all their good ideas and advice. (I’m also grateful for Skype itself.)
I’d particularly like to thank the four people whose work formed the basis of the case studies described in the book. These executives shared extensive information with me about the scenario planning exercises they undertook, and I’d like to express my sincere appreciation to them for their time and generosity, and their willingness to walk me through the results of their four quite different processes:
Encouragement is also something every writer needs and cherishes. I was very lucky in this department, receiving moral support from many people here in Switzerland, including Nanci Govinder, Paul Lemeer, Mick Dawidowicz, Marc-Olivier Gemmet, Cory Ann Notari, Marnix Coopman, John Hurst, Olivier Taverney, and especially my terrific friends and mentors Chris and Christina Norton, whom I look up to every day.
Last, how could I not thank my two biggest cheerleaders, my kids Malcolm and Claire Wade? They kept me going throughout the project, and still do.
“The problem with the future is that it is different. If you are unable to think differently, the future will always arrive as a surprise.“
Gary Hamel
A few days before Christmas 1930, Albert Einstein, the most celebrated scientist on earth, was sailing from Europe to New York aboard a luxury ocean liner. A lucky journalist who happened to be on board asked the physicist for an interview and was surprised that Einstein agreed.
Like today, the world was an uncertain place on the cusp of the 1930s—much more so, in fact. A worldwide Depression had begun, Fascists and Nazis lurked in dark alleyways all across Europe, and the prospect of another world war was very real. Holding Einstein in great esteem as an intelligent man—a genius, a visionary—the reporter opened his notebook and asked him a simple and by all means reasonable question: “Professor, what are your expectations for the future?”
Einstein’s reply was surprising. No, not merely surprising—from such a man, his answer was astonishingly idiotic: “The future?” said Einstein,
“Oh, I never think about the future.
It will be here soon enough.”
Huh? Imagine the CEO of your company saying that to the board of directors. How long would he last in his job? Or, never mind the CEO, imagine yourself saying this in a discussion with your boss: Her: “How do the three-year projections look, Quigley?” You: “Sorry, you talkin’ to me, boss lady? Hey, I never think about the future. It’ll get here on its own, believe me. Que sera sera!
Quigley, take some friendly advice: Update your resume.
As for Einstein, well, we’re at the very beginning of this book, and who wants to start off on a negative note? So let’s be charitable. Perhaps Einstein’s “Don’t worry, be happy” moment was nothing more than a reflection of what the French call a déformation professionnelle—the natural bias you develop thanks to the one-sided perspective you’re exposed to in your work. Maybe the natural bias of scientists is not to focus on tomorrow but rather to concentrate on the here and now. For them, the salient question is, “What are the facts?” (i.e. the facts as they exist right now). Do the experimental results confirm my hypothesis? (That’s today’s experiment we’re talking about.) How does the data look? (Not, mind you, how do you think the data might turn out to look five or ten years from now?)
So, we’ll give Albert a break. It’s not really his fault if his thinking was a little slipshod. After all, he was merely a nuclear physicist, not a manager, and if you keep this deficiency in mind, his laissez-faire attitude toward the future can perhaps be forgiven.
In a job interview, however, Einstein’s “who-cares-let’s-wait-and-see” mind-set regarding the future wouldn’t land him many offers. It’s simply inconceivable that a business leader—someone intelligent, someone expected to assume significant responsibilities—could ever think like this (and hope to be promoted).
That’s because management, unlike science, is entirely future-oriented.
As a manager, most of the decisions you make today—and all of the really big ones—have to do with improving the chances for your organization to perform well in the future. Right now, based on the best information you have (which, by the way, isn’t likely to be as reliable as experimental data produced under ideal laboratory conditions), you must make decisions about:
. . . and countless other aspects of your business that will affect how competitive you will be—in the future. In fact, it’s no exaggeration to say: Managers live for the future.
That’s why you must give some thought to what the future will be like, because that’s where you will live. It’s not only here, in today’s environment, where you have to be a winner, but in order to succeed over the long run, you’ll have to compete in the world as it will exist in the future. What will this world be like? Nobody knows. But since it is going to be your operating environment, you’d better give it some thought!
When you do, don’t limit your thinking to only the future of your company and its products. Look beyond your front door, and think about how your entire business environment—the whole world, even—will evolve. Visualize how the future could unfold and create a new and different business “landscape” compared to the world that you’re operating in today.
In this as-yet-unknown future landscape, your company will have to be competitive.
In this new landscape, the terrain may differ greatly from what you’re used to today. What’s more, it won’t be only the background scenery—the economic and social settings, the technologies, politics, and regulations that underpin your day-to-day existence—that will evolve between now and then. It’s highly likely that different competitors will roam that landscape with you, as will different suppliers, not to mention a whole new set of people with new attitudes and expectations, many of whom today are still youngsters, their tastes and preferences and desires not yet fully formed. These are the people you’ll need to sell to, hire, and inspire if you’re going to thrive 10 years down the road.
The earlier you can sharpen your vision of the road ahead, identifying and describing the changes you’ll likely be dealing with, the better prepared you’ll be for the new competitive challenges and opportunities this landscape will have to offer you.
But (I hear you saying) nobody knows how the future is going to turn out! How can you describe something that’s not yet here to see?
That’s what this book is all about. It will introduce you to a planning method that can open your eyes to future changes and opportunities that might materialize, help you maximize your flexibility so you can compete effectively in different landscapes that may emerge, and prepare you not just for the future, but for several possible futures.
There’s no better time to start this process than now. After all, as Einstein said, “The future will be here soon enough.” And he was the world’s smartest guy.
